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A Section from "The Continuous Improvement Development Guide"

Volume 2: Committing >

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Think Long Term (Principle)

Basic Section Information

One of the problems that we face in business is impatience. We want quick results when we start a new initiative. We want new processes to pay off immediately. As a result, leaders often choose less effective options that provide some return on investment quickly rather than more effective ones that take a while to develop into greater fruition. In large part, this is a function of the pressures of the stock market.  Quarterly earnings reports force leaders to think in three month chunks of time.

There is also a trend for people to expect immediate results with very little work or commitment of time. There are a glut of reasons. Reality shows have convinced people that you can turn around a business in just a few days. Social media highlights all the big wins people have, while failing to address the work or risk or investment it took to get those wins. To top it off, there is a strong niche of self-help books that has focused on tricks, gimmicks, and quick changes that they promise can deliver monumental returns.  

This is a serious challenge to continuous improvement initiatives. It is true that some of the tools can have a quick payoff in specific situations. Applying the 5 Whys, for example, can eliminate a nagging problem in short order.

But many of the more powerful cultural changes—the ones that really impact a company—can take years to put in place. This principle, Think Long Term, keeps the leadership team focused on the potential greatness of the company rather than harvesting small, quick returns on improvement resources.


Do a quick self-assessment of your company’s goal-setting history. Look for indications that short term decisions trump long term planning. You can see this when R&D is cut to hit quarterly earnings targets, or if you have had a series of initiatives that were abandoned within a year of starting. Also look at the turnover rate of key leaders. The key is to determine how ingrained short term thinking is in your company.

Section Details

Estimated Time for Section: Ongoing

Difficulty: High. This is difficult mindset to change, especially if the company is large and has stockholder pressures. Any perception of failure can undercut senior management and jeopardize continuity of leadership.

Risk: High. Short term thinking is a large contributor to the high percentage of failures in Lean initiatives. It takes significant time to lay the foundation for continuous improvement. There can be a large outlay of effort and resources (particularly time) before there will be a sustained impact on the bottom line.


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Detailed Section Information

The main problem with not focusing on long term thinking is that the company gravitates towards less effective quick-fix choices. Short term thinking tends to have front loaded benefits and back-loaded costs. That means that you pay for today’s gains tomorrow.

Long term thinking has greater gains down the road, but tend to have front-loaded costs. There is generally a much higher return on investment, but the delay can make it unpalatable.

Developing People

Developing a continuous improvement culture requires commitment. First and foremost is the investment in people. It takes substantial time to train a person to have the right mindset to operate in a company that focuses on improvement. They need to be mentored. They need to be given opportunities to try and fail and then try again using the lessons they learned. They need to be cross-trained. They need to be available to support other departments’ improvement efforts. They also need to be retained. If you invest in people, they become more valuable, and not just to you.

If you think short term, you will not protect your investment in people. You’ll let them seek to apply those newly developed talents in another company. Not only do you need to devote the resources to improve your team, but you also have to make sure that their compensation rises in lockstep with those skills.

Developing Processes

In addition, the company has to commit to building and revising processes. Dialing in these new ways of doing things can take time. It also takes some leaps of faith that can be disruptive to near-term operations. Short term focus means people will be less willing to shake things up.

Short term thinking looks at a failure and seeks a quick stopgap. Long term thinking looks at a failure and identifies the underlying process that needs to be overhauled to prevent that problem from ever recurring.

As your processes get better and better over time, the effort needed to fix issues will be tweaks rather than major endeavors. But early on, as you look at processes for the first time, you can be overwhelmed. There are often not really any set processes in place. Sometimes it is just a group of several people doing their own thing however they feel like it on that particular day. Creating a unified process can create substantial pushback. Managing that change takes commitment, despite the effort and interim chaos.

Developing Infrastructure

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Harvesting Gains

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Leadership Changes

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  • This principle is not one that you can jump into completely. If you don’t have long-term infrastructure developed, you can’t simply eliminate short-term solutions. It will take some time to gravitate towards making long-term investments.
  • Long term thinking means staffing for improvement activity. Decide how much time your team should be working on projects, and then build that time into your staffing plan. Don’t forget to account for vacations, sick time, meetings, training, etc. If you only staff for production, you are guilty of short term thinking.

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  • Short term thinking trades lower immediate costs for higher long term benefits. It also often defers bigger expenses.
  • Long term thinking is more palatable for companies that have a long-term, influential owner. Family businesses or those that are publicly traded but have a small group of long-time investors with powerful voting blocks tolerate long term thinking. Companies that are widely held tend to be more at the mercy of the whims of the stock market.

Additional information on this topic is available in our premium version of this section of our practical guide to continuous improvement.

This information is only available in our member and premium versions of this section of our practical guide to continuous improvement.

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